Sumitomo Realty adopts trust for strategic 400 billion yen share sales

Sumitomo Realty & Development Co., Ltd. announced a pioneering scheme to sell 400 billion yen of listed securities (strategic and pure investments) over the next ten years through an irrevocable trust. This marks Japan's first use of such a trust for systematic, compliant share divestment, aiming to secure capital gains and dividends to offset rising interest expenses and fuel profit growth.

The trust, with Mizuho Trust & Banking Co., Ltd. as trustee and Sumitomo Realty as settlor and beneficiary, will commence in March 2026 following a February 2026 agreement. The shares, for which issuer consent has been obtained, will be sold at the trustee's discretion within the company's sales policy, with voting rights also exercised by the trustee. The trust will terminate upon the sale of all entrusted shares.

Upon trust commencement, these shares will be reclassified from "strategic shareholdings" to "pure investment shares" to meet pure investment requirements. This strategic divestment is expected to contribute to future profit growth, aligning with anticipated contributions from major redevelopment projects.